The suspension has sparked fears of cash crunch and default of payment in the Financial Technology-promoted commodity bourse. The exchange has blamed the government for the structural changes it has instructed a few weeks back for creating market disequilibrium.
At 10:50 a.m.; Financial Technologies Ltd was trading 40 per cent lower at Rs 324.55. The stock plunged over 53 per cent in trade to hit its fresh 52-week low of Rs 251.00 in trade on the Bombay Stock Exchange.
"The brokers said that the exchange has stopped payouts on Wednesday due to financial crisis, which could impact operations of many of the brokers who are into commodity trading on Thursday," ET reported.
"National Spot Exchange (NSEL) has suspended trading of contracts, other than e-Series contracts till further notice. It has also decided to merge the delivery and settlement of all pending contracts and deferred the same for a period of 15 days. Consequently, the positions outstanding in the contracts will be settled by way of delivery and payment after expiry of 15 days," NSEL said in a late evening press release on Wednesday.
Two weeks ago, the consumer affairs department had asked NSEL not to launch contracts of new commodities until the government finalises a new regulatory framework, for alleged violation of certain rules while offering commodity contracts.
Following this, the bourse gave an undertaking to the government that existing contracts will be settled on the due date and no new contracts will be launched. Simultaneously, it introduced T+10 with trade-to-trade settlement.
NSEL currently offers trading in over 40 commodities including castor seed, paddy, e-gold and silver, etc.
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